Cactus, Inc. (WHD) Balance Sheet

The balance sheet has expanded significantly, with total assets jumping from $1.6B in 2024Q1 to $2.6B in 2026Q2, a 63% increase. This growth is largely attributable to the acquisition in 2026Q1, which added $301M in assets, as evidenced by the jump in goodwill from $203M to $248M and then to $287M. Equity has also grown consistently, from $893M to $1.2B, reflecting retained earnings accumulation. The trajectory suggests a deliberate expansion strategy, but investors should monitor whether the acquired assets generate returns commensurate with the increased capital base.

Cactus maintains a remarkably low leverage profile, with D/E consistently at 0.03 and total debt never exceeding $56.2M. This suggests that the company is not reliant on debt financing for its operations or growth, and the acquisition in 2026Q1 appears to have been funded primarily with cash, given the cash balance dropped from $494.6M in 2025Q4 to $291.6M in 2026Q1. The low leverage provides significant financial flexibility, but it also implies that management is conservative in its capital structure choices, potentially forgoing tax benefits or higher returns on equity. The debt level is manageable, with no apparent refinancing risk.

The asset composition reveals a shift toward intangible assets, with goodwill increasing by $84M over the past two quarters, from $203M to $287M, while net PPE has remained relatively flat at approximately $370M. This suggests that the recent acquisition was primarily for intellectual property, customer relationships, or market access rather than physical capacity. The stability in PPE indicates a mature asset base with limited expansion in physical footprint. Investors should monitor the goodwill balance for potential impairment risk, especially if the acquired business underperforms, as the carrying value now represents about 11% of total assets.

Equity quality is solid, with retained earnings being the primary driver of growth, increasing by $229M over the period. This indicates that the company is generating profits and reinvesting them into the business rather than distributing them. The equity base has grown from $893M to $1.2B, a 34% increase, which is consistent with a company in a growth phase. However, the prior income statement analysis noted a one-time loss in 2026Q1, which may have temporarily slowed retained earnings growth, but the subsequent recovery in 2026Q2 suggests resilience. The lack of significant share repurchases or dilution, as indicated by stable share counts, further supports the quality of equity.

Liquidity is ample, with a current ratio of 2.59 in 2026Q2, down from a peak of 5.81 in 2025Q4 but still well above the 1.0 threshold. Cash balances have fluctuated, reaching a high of $494.6M in 2025Q4 before dropping to $291.6M in 2026Q1 due to the acquisition, then recovering to $365.8M in 2026Q2. This indicates that the company can cover its short-term obligations comfortably and has sufficient cash to fund operations and potential investments. The liquidity position is particularly strong relative to peers, with NOV and DNOW having current ratios of 2.42 and 2.34, respectively. The cash position also provides a cushion against the cyclicality of the energy sector.